Goodbye to federal funding for 2012 presidential candidates

NEW YORK, N.Y. — A cornerstone of U.S. politics since the 1970s, public funding of presidential campaigns soon may go the way of other relics of the era like long sideburns and lava lamps. Neither President Barack Obama nor any of the leading 2012 Republican contenders is expected to accept federal matching funds and the limits they impose.

In fact, opting to take public money to finance a presidential campaign this year is likely to be seen as the mark of a loser.

“I would be shocked if they took matching funds. I don’t think that it’s a successful model this time, or in the future,” says GOP strategist Carl Forti. He has been an adviser to former Massachusetts Gov. Mitt Romney and helped run American Crossroads, an independent group that raised millions to defeat Democratic candidates in 2010.

Obama’s record-breaking fundraising in the 2008 campaign allowed him to abandon the public system in both the Democratic primaries and the general election. With his success as a benchmark, top-tier Republican candidates now are planning to go it alone.

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The president, who has no Democratic primary race, may become the first candidate to raise $1 billion for the general election in 2012.

Republicans in a wide field must battle each other for the party’s private donors. But the emergence of free-spending independent political groups — since the Supreme Court in 2009 cleared the way for unlimited corporate spending in campaigns — is expected to help close the imbalance between Obama and the GOP. Several of the Republicans also have immense personal wealth.

Presidential candidates of both parties once relied on money from the U.S. Treasury as an indispensable part of their budgets. Indeed, the ability to qualify for matching funds was considered an indication of a candidate’s strength after the system was put in place after Watergate-era fundraising abuses. The system was intended to reduce candidates’ dependence on large contributions from individuals and groups.

Money for the program comes from a voluntary $3 checkoff on Americans’ income tax returns. The fund now contains $195 million, which can be used only for presidential primary and general election campaigns and to subsidize the major parties’ nominating conventions.

Over time, the program began to weaken. George W. Bush refused public funding in his 2000 and 2004 presidential primary campaigns but did accept the money in the general election. Several candidates in both parties opted out in the 2008 primaries, but others did accept matching funds, including Democrat John Edwards.

Arizona Sen. John McCain, the 2008 GOP nominee, turned down matching funds for the primaries but then took them in the general election — a move that severely hindered his ability to compete financially with Obama.

For this year’s serious GOP candidates, refusing federal funds will be both liberating and daunting.

By refusing matching funds, candidates potentially are forfeiting a lot of money. Edwards received nearly $13 million in matching funds in the 2008 primary, and Joe Biden, now the vice president, accepted more than $2 million for his primary run. McCain, the winner of the GOP nomination that year, accepted $84 million in federal funds for the general election, but that barred him from any private fundraising. Obama opted out of the system and raised $264 million.

For the general election this time, a qualifying party’s nominee would get just under $90 million and would be prohibited from raising more privately. For the primaries it’s more complicated: Qualifying candidates can receive a federal match of up to $250 for each contribution from an individual and must abide by both state spending limits and an overall spending limit of around $50 million.